Voss v. Stranahan

227 N.W. 542 | Mich. | 1929

Defendant Stranahan drove his automobile against plaintiff's son causing serious injury. Plaintiff recovered judgment for his damages against Stranahan for $1,782.25 and costs. In the trial of that cause defendant Ford was attorney for Stranahan and he may also have been acting for the *392 other defendant, Wolverine Mutual Motor Insurance Company, a Michigan corporation, a mutual company, as its name indicates, which company had issued to Stranahan a policy in common form, covering the automobile as to fire and theft in named amount, and indemnity against liability for damages for personal injury, defense of suit, etc., in the amount of $1,000. There had been, before the trial of the said cause, correspondence and negotiation between counsel in an attempt to settle, but without success. Very soon after entry of the judgment Stranahan and his attorney requested of the insurance company that the $1,000 be forwarded by telegraph. This was done, and the company received release. Of the sum the attorney received his fees and Stranahan took the rest. Plaintiff's later writ of garnishment brought disclosure of the payment. This bill is filed on the theory of fraud and conspiracy on the part of the defendants, and it is contended that what was done is a fraud upon the rights of plaintiff.

Defendants have appealed from a decree for plaintiff.

The policy of insurance here is like that discussed inGriffin v. Casualty Surety Co., 231 Mich. 642. It provided not indemnity against damages but indemnity against liability for damages. When Stranahan's liability for damages was determined by the entry of the judgment, thereupon (on this record) there became due and payable from the insurance company to Stranahan the sum provided by the policy. It was the legal right of Stranahan to have it, and it was the legal duty of the company to pay it. Without paying the judgment Stranahan had right to sue the company and to recover. Griffin v. Casualty Surety Co., supra. *393 Plaintiff had no rights under the policy. He was not a party to it. The amount due was not even a trust fund for his benefit. 2 Berry on Automobiles (6th Ed.), § 2186; Bain v. Atkins,181 Mass. 240 (63 N.E. 414, 57 L.R.A. 791, 92 Am. St. Rep. 411);Randall v. Railway, 134 Mich. 493.

Stranahan and his attorney were in the exercise of a legal right in collecting the money and the insurance company but discharged a legal duty in paying it. This therefore cannot be held to be fraud. See 12 Rawle C. L. p. 237; 26 C. J. p. 1177; note 27 A.L.R. p. 1417; Damon v. Bache, 55 Pa. St. 67 (93 Am.Dec. 730); Shibler v. Hartley, 201 Pa. St. 286 (50 A. 950, 88 Am. St. Rep. 811).

It follows that the decree is reversed, and the bill dismissed, with costs to defendants.

NORTH, C.J., and FEAD, WIEST, McDONALD, POTTER, and SHARPE, JJ., concurred. The late Justice FELLOWS took no part in this decision.

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